I’m thinking of taking a gold loan for some urgent expenses, but I’ve never done it before. Can someone explain the full process in a simple way?
The gold loan process is actually simple and quick. Here’s how it usually works, step by step:
- Visit the branch or apply online – You can walk into any bank or NBFC that offers gold loans, or apply online with some basic details.
- Bring your gold – Carry your gold jewellery (usually 18 to 24 karat). Coins may be accepted too, depending on the lender.
- Gold valuation – The lender will check the purity and weight of your gold. Based on current market rates, they calculate the loan amount (usually up to 75% of gold’s value).
- KYC and paperwork – You’ll need to submit basic documents like Aadhaar, PAN, and a passport-size photo. Income proof is usually not required.
- Loan sanction – Once the gold is valued and documents are verified, the loan is approved. The entire process can take as little as 30 minutes.
- Disbursement – The loan amount is given to you through cash, bank transfer, or cheque, depending on the lender’s policy.
- Repayment – You can choose how to repay: EMIs, interest-only payments, or lump sum at the end of tenure.
- Gold return – Once the loan is fully repaid, your gold is returned to you in the same condition, sealed and safely stored during the loan period.